Emails pull back curtain on N. Carolina coal ash settlement

RALEIGH, N.C. - Internal emails between staff at North Carolina's environmental agency suggest state regulators were coordinating with Duke Energy before intervening in efforts by citizens groups trying to file suit over groundwater pollution leeching from Duke's coal ash dumps.

The emails were provided Thursday to The Associated Press by the Southern Environmental Law Center, which filed notice in January 2013 of its intent to sue the electricity company under the Clean Water Act.

Within days, the emails show a Duke lobbyist contacted the N.C. Department of Environment and Natural Resources to set up a meeting. The emails suggest the company and regulators were in frequent contact, with a lawyer for Duke even advising the state on legal strategy in an email on April 30, 2013.

No citizen input

At the time, the environmental law center's lawyers were worried that Duke and state regulators would reach a deal with no input from the citizens groups. They told the state that the groups couldn't legally be blocked from participating.

But the emails show that Duke lawyer Charles Case tried to find a case that could be used to convince a judge otherwise.

The email was forwarded by Special Deputy Attorney General Kathy Cooper to Lacy Presnell, the top lawyer at the state environmental agency, on May 15. Cooper had been assigned to represent the state in the lawsuit.

Case wrote that Presnell had requested "an example of participation by a intervenor on a non-party basis."

On July 3, a transcript shows Cooper went before Wake County Judge Paul Ridgeway and argued that the citizens groups should be excluded from the legal proceedings.

'Sweetheart deal'

The agency ultimately intervened in the lawsuit, quickly negotiating a proposal under which the $50 billion company would pay a $99,100 fine to settle environmental violations but be under no requirement to actually clean up its pollution.

Environmentalists have derided the proposal as a "sweetheart deal" by compliant state regulators to shield Duke from far harsher and more expensive penalties the company likely would have faced had the citizens groups been allowed move forward in federal court.

That proposed settlement was tabled last month after a massive spill from a Duke dump in Eden that coated 70 miles of the Dan River in toxic gray sludge. Coal ash contains a witch's brew of dangerous chemicals, including arsenic, lead and selenium.

Duke did not immediately respond to requests for comment.

Federal prosecutors have launched a criminal investigation in the wake of the spill, issuing at least 23 grand jury subpoenas to Duke executives and state officials.